Commercial, International - 29. November 2018
What were the focal points of this year’s Mapic conference?
Frank Heskjær, our retail manager, attended one of the world’s largest retail conferences in Cannes recently. He noted several trends that will affect the retail industry in future.
Transformation, experiences, showrooms and Relate to Reality. These
are the four overall trends that Frank Heskjær brought back from Mapic. The
retail industry is facing changes that make heavy demands on landlords and the
industry as a whole.
He noted the following focal points, all of which were fiercely
debated during the fair.
Transformation of tenant types
The major chains are starting to close shops, they are cutting down
on floor areas, and they are moving locations. The tenant mix in which
landlords will have to put their future faith is transforming. Space in pedestrian
streets and large shops is becoming vacant as online shopping increases. As a
result, more fashion and sports shops are closing or downsizing, but we are
also seeing a wave of new tenant types such as housing, interior, kitchen and
lifestyle stores, which are moving back into town centres after a long hiatus.
In addition, beauty parlours, hairdressers, personal trainers and coaches and
tattooists may occupy more of the excess floorage, as they offer services
customers cannot buy online.
Shops that resemble showrooms will be more visible in future. Tesla
is looking for larger showrooms in major European cities, and it is hardly
inconceivable to envision a future where retail premises have two or three
Tesla models, accessories and a shop assistant on hand to give the necessary
information as inspiration.
Relate to Reality
Tenants will increasingly demand flexible leases, which will put
demands on landlords. Tenants increasingly prefer revenue-based rent over more
traditional fixed rent. This requires tenants and landlords to cooperate more
closely, so that both parties ultimately enjoy the largest possible financial
gain in the tenancy relationship. Consequently, landlords must to a greater
extent consider the structure of their leases, and the following factors are
worth taking into account: Should rent be revenue-based? How long is the
tenant’s period of non-terminability? Should the landlord be awarded bonuses if
the criteria for the lease are met? Flexible leases put pressure on the
traditional terms and conditions, and the longer a landlord waits, the more
expensive it may turn out to be.
Experiences and inspiration
The retail industry is putting a bigger premium on experiences,
which partly outcompete traditional trade. Experiences connected to purchases
are gaining importance, and the product or the price in itself is not what
determines a success or a failure. Unconventional experiences, in particular
cultural events (art, music, dance) that include museums, travels and concerts,
are becoming a growing part of retail. The point is to give customers an
exceptional experience they cannot get online. Several successful shopping
malls in Europe have adopted the trend, offering specific events every day of
the year, where – without having to pay extra – customers can enjoy the usual
shopping facilities as well as greater experiences.